AFH ROI Calculator
Estimate return on investment from an Adult Family Home using your initial investment, monthly revenue, expenses, optional appreciation, and holding period.
These calculators provide estimates for planning purposes only. Actual costs, reimbursement rates, taxes, staffing requirements, licensing requirements, and profitability can vary by location and individual circumstances. This tool is not financial, legal, tax, licensing, or medical advice. Results are based on entered assumptions.
How it works
- Monthly operating profit = monthly revenue − monthly operating expenses.
- Annual operating profit = monthly operating profit × 12.
- Total operating profit = annual operating profit × holding period in years.
- Optional appreciation estimates a change in property value using annual compounding.
- ROI percentage = total estimated return ÷ initial investment.
Example using the default assumptions
With a $150,000 investment, $33,150 monthly revenue, and $20,310 monthly expenses, estimated annual operating profit is $154,080. Over five years, total operating profit is $770,400, which is an estimated 513% cumulative operating ROI if those assumptions held the entire time. This is an illustration, not a forecast.
Important assumptions
- Revenue and expenses are held constant across the holding period.
- ROI here is a simple cumulative ratio, not an IRR, cap rate, or after-tax return.
- Appreciation is optional and should be left at 0 if you do not want to include property value change.
- The model does not include sale costs, refinancing, or capital improvements after opening.
Frequently asked questions
Is this ROI guaranteed?
No. ROI is an estimate based on the investment, revenue, expenses, and holding period you enter. Real results change with occupancy, rates, costs, and time.
What should I use as initial investment?
Use the cash you put into opening the home: down payment, startup costs, and working capital. You can copy a total from the startup cost calculator.
Does appreciation assume the home will gain value?
Only if you enter an annual appreciation rate. Leave it at 0 to measure operating return alone.
Why is this not the same as a cap rate?
A cap rate typically compares one year of net operating income to property value. This ROI tool compares cumulative estimated return to your cash investment over several years.
Are taxes included?
No. Enter after-tax figures yourself if you want a rougher after-tax view, or keep the result as a pre-tax operating estimate.
Can investors use this for a 6-bed home?
Yes. It is a planning worksheet for owners and investors. It is not an offering, appraisal, or investment recommendation.
Need another AFH estimate?
Explore occupancy, staffing, startup costs, Medicaid rates, and other Adult Family Home planning tools. Every calculator is free and works without an account.
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